This package of 10 country-specific text files contains the supporting data for Peter H. Lindert and Peter J. Morton, “How Sovereign Debt Has Worked” in Jeffrey Sachs (ed.), Developing Country Debt and Economic Performance (NBER and University of Chicago Press, 1989).
Lindert and Morton are grateful to Rui Esteves of UC Berkeley for transferring these converted Word files to us, October 2005.
Some brief explanations of what the data represent:
LOAN TITLE: Self-explanatory
NITIAL YEAR: The year in which the loan is made.
LIMIT YEAR: A year after which we stopped recording information about the loan. This may be because the loan was fully repaid, irretrievably defaulted, or still alive as of 1983, the last year of our sample. (For the purpose of calculating rates of return we assumed that loans still alive in 1983 were paid off at par in that year.)
INTEREST RATE: This is the coupon rate, not the effective rate.
CURRENCY TRANSACTED: The currency in which service was due. In cases where the bondholders had an option to receive service in one of several different currencies, we usually designated pound sterling as the currency of service.
0 = ENGLISH POUNDS
1 = AMERICAN DOLLARS”
2 = FRENCH FRANCS”
3 = SWISS FRANCS”
4 = GERMAN MARKS”
5 = ITALIAN LIRE”
6 = SPANISH PESETAS”
7 = DUTCH GUILDERS”
8 = RUSSIAN ROUBLES”
9 = GOLD (USE WITH CAUTION)”
CURRENCY OF ACCOUNT: Some source compendia would pre-convert all figures to, say, pounds sterling, even for loans which were serviceable in other currencies. In a case like this the currency transacted might be French Francs, but the “Currency of Account” would be Pound Sterling.
POWER OF 10: Self-explanatory
BORROWER TYPE: S = SUBORDINATE REGIONAL GOV’T (PROVINCE, STATE, ETC.)
M = MUNICIPAL GOVERNMENT”
R = RAILROAD OR OTHER TRANSPORT LINE
P = PUBLIC UTILITY (AVOID WHERE POSSIBLE)”
Q = QUASI-GOVERNMENTAL BODY (IE, SCHOOL DISTRICT)
N = NATIONAL BANK (OR OTHER GOV’T RUN BANK)”
SOURCE CITATIONS: PAGE REFERENCE FROM FENN (1873)
PAGE REFERENCE FROM FENN (1889)
PAGE REFERENCE FROM FENN (1898)
PAGE REFERENCE FROM FITCH (1918)
PAGE REFERENCE FROM KIMBER (1925)
PAGE REFERENCE FROM KIMBER (1933)
YEAR REFERENCE FROM C.F.B.H.
YEAR REFERENCE FROM F.B.P.C.
SIMPLE/COMPLEX: A loan paid as agreed which had no change in the coupon interest rate or in the retirement schedule was considered simple. Other loans with discontinuities of one sort or another were considered complex.
BUYBACK RATE ESTIMATE: When a too-rapid decline in the reported balance outstanding made us suspicious that countries were buying back debt below par in the open market, we could iterate a “buyback price” designed to let us hit a target amount outstanding in a particular year. When the decline in the reported balance outstanding was too rapid, we simply assumed that the sinking fund was not being fully served. (For this reason, you may note that for some loans, the decline in the amount outstanding does not match the reported retirement cash flow.)
# OF CHANGES DECLARED: Basically the number of discontinuities we were able to account for during the life of the loan. You may safely disregard the -1 value entered here for simple loans. It had some significance internally for the data entry program we used in the 1980s, but for practical purposes the only meaning is “no changes”.
BALANCE PAID OFF IN LIMIT YEAR? As mentioned above, this feature allowed us to assume a hypothetical lump-sum payoff for the purpose of calculating rates of return and net present value.
METHOD OF ESTABLISHING ANNUITY: Basically there were three options for determining the amount of the annual service:
(a)The source material directly provided an annual figure.
(b)The source material specified a sinking fund in percentage terms.
(c)The source material specified the coupon rate and the payoff date
THE REST OF THE STORY: This space was available for the operator to add comments.
OPTIONAL COMMENTS: This space was available for the operator to add more comments.
OPERATOR: Wendy is Wendy Eudey, Peter is usually Peter M., except for Canada. We had another operator early in the project but I [Peter Morton] don’t think she recorded any loans.
UNASSIGNED: This has no meaning.
YEAR: Self-explanatory.
CAPFLOW: Any lump-sum non-recurring payment between the lender and the borrower. This would include the initial proceeds of the loan, any large once-only retirement of principal, conversion to a new funding loan, or a fictitious payoff in the limit year.
OUTST: This is the face amount of outstanding debt at the end of the year.
INTEREST: This should always equal the coupon rate times the amount outstanding at the end of the previous year.
RETIRED: The amount actually paid to the creditors to retire principal. If the buyback rate estimate is equal to one, it should match the difference between last year’s outstanding amount and the current year’s outstanding amount.